Africa has rare metals such as tungsten, cobalt and lithium, which are used in electric vehicles, green energy, robotics, defense systems and more. Cobalt is for battery manufacture. Lithium is for rechargeable cells. For applications in tungsten, high temperature and tools. Having large reserves of some of these inputs is what puts Africa on the map. Who benefits from growing global demand in Africa: governments, communities, multinationals, or middlemen in the supply chain? This is a very simple question, but it has many consequences for societies, economies and Africa at large.
In this article, I will dissect this topic. Let’s find out who actually benefits from the mining of these rare metals in Africa.
Where do metals come from?
Let’s first understand where these metals are found and which countries have the most of them.
- Cobalt: The Democratic Republic of Congo (DRC) is a major player in cobalt production and reserves. Most of the mined cobalt, both industrial and artisanal, is obtained from here. Therefore, any change in DRC can be felt throughout the global supply chain for batteries. Recent government moves towards traceability and export quotas show how sensitive this market is to domestic decisions.
- Lithium: Africa is a major player in the production of battery-grade spodumene and hard rock lithium, with new projects springing up in Zimbabwe, Mali, Namibia, and Madagascar. In 2025, Africa accounts for the largest share of global surplus supply growth.
- Tungsten: Tungsten supplies are heavily dependent on China, which itself holds a significant share of global production and reserves, but the presence of African deposits (in Rwanda, Mozambique, and some other countries) is increasingly attractive to companies that diversify their sources rather than relying on a single exporting country. Thus, African reserves have become truly important globally.
The Value Chain: Where the Money Is (and Leaks)
Mining produces a raw material. However, most of the cost is in post-extraction processing, refining, battery manufacturing, and final product assembly.
- upstream (extraction): Artisanal miners, small operators, and large industrial firms extract the ore. Artisanal and small-scale mining (ASM) is particularly important in the DRC for cobalt and many tin/tantalum/tungsten mines. This economy provides a living but often works informally.
- Midstream (benefits, refinement): There is a wide range of price increases here. Capital plants are required to convert the raw materials into battery-grade salts of cobalt or lithium hydroxide. Traditionally, African countries exported ore and imported high value added refined products. It trades long-term prosperity for short-term export earnings.
- Downstream (Manufacturing and Assembly): This is the highest value segment: cells, battery packs, EV assembly, and advanced materials. Few African countries currently host significant downstream battery manufacturing.
Who wins? Large multinational miners and traders often capture large margins, especially when they have control of midstream capacity. Host governments collect taxes, royalties, and in some cases, equity stakes, but weak agreements and governance gaps ensure that much value is quickly drained from the country. Local communities may enjoy some wage and small business benefits, but suffer disproportionately from environmental and social costs.
Artifact mining
Artisanal miners are very important for cobalt and other important minerals. For many households living in places like the DRC, ASM is an important source of income. However, there are some major policy and credibility challenges that the ASM model raises:
- Irregularities and Traceability: Supply chains that include artisanal production are difficult to trace, triggering compliance headaches for global buyers seeking “conflict-free” or ESG-compliant cobalt. The DRC is working on traceable artisanal cobalt programs to improve conditions and market access, a sign that formalization is possible but difficult.
- Human costs: ASM sites can be dangerous and sometimes involve child labor, exploitative middlemen and armed groups in conflict zones. Among other factors, these facts make investors wary and, in some cases, encourage boycotts or restrictions that could deprive local people in the areas of income.
- Price display: Artifact miners are usually paid at the mine gate, which is often a very small fraction of the downstream value of the ore. Middlemen who aggregate, transport and export occupy a large spread.
Artisanal mining provides social value through employment. This rarely changes life economically unless there is appropriate policy intervention: licensing, formal markets, price guarantee mechanisms, and health and safety programs.
Governments: Taxation and Bargaining Power
African governments have some direct benefits: royalties, taxes, and sometimes equity stakes in mining operations. Unfortunately, however, several structural issues limit such benefits when it comes to the net value of the metal.
- Under recovery: Most of the most valuable properties remain unsecured overseas, as the raw ore is exported or shipped instead of the refined product. Countries with processing facilities retain this value. One policy that could change that calculus is Zimbabwe’s push to exploit lithium.
- Terms of Agreement: Poorly negotiated contracts and legal frameworks can drive rent to developers. Thus, especially with new demands for minerals, weak regulators or sudden investment pressures can lead a country into undesirable situations.
- Policy Instability: Sudden announcements of export bans, changes in quotas, or changes in licenses, often to assert control or raise revenue, prevent long-term investors from creating price volatility while benefiting middlemen who arbitrage during shocks. Recent moves on quotas and traceability for cobalt emanating from the DRC show how policy changes affect markets.
Some good policy tools to improve country benefits would include a clear mining code, ring funding revenue for development, local content laws (for jobs and procurement), and incentives for downstream processing.
Major beneficiaries: agents and foreign investors
Large mining firms, foreign refiners, and state-backed, often Chinese, European, or American enterprises typically comprise the most profitable groups. They hold capital, supplies and markets, but also bargaining power.
This vertical integration for buyers (eg, battery companies that acquire upstream supplies) enables these companies to secure raw materials while collecting large portions of value along the chain.
China’s role in processing and refining is strong in a number of metals, particularly important for tungsten and lithium, where Chinese companies account for large amounts of Chinese-invested refining. This has policy implications in terms of supply diversification and geopolitical leverage.
If these large corporations and investors commit to local hiring and procurement, revenue transparency and community investment, the local community will benefit the most.
Mining the earth to create metals and minerals creates jobs. At the same time, mining brings pollution, water stress, land loss and social disruption. Recent research and reports have highlighted the tragic realities of threats: tailings pollution, groundwater depletion, deforestation and landslides. Weak regulation and quick plan approval will reinforce these effects.
Communities around working mines usually benefit from the least mining and the most damage: noise, dust exposure, health problems and loss of farmland. The result is that, if governments do not enforce environmental protection and companies do not contribute money to remediation, the social license to operate disappears, and with it long-term investment.
How to balance benefits: Policy measures in practice
If African countries are to capitalize on the growing demand for these rare metals, urgent action will be required. Overseas countries have long exploited Africa and reaped the greatest benefits from mining these rare metals, while leaving communities to deal with the negative consequences of mining. To change this situation, practical steps will need to be taken:
- Local benefits and industrial policy: Africa should invest in clear incentives for midstream processing (smelling, refining) and battery manufacturing. Already, countries such as Zimbabwe are pursuing pro-lithium policies.
- Regulate and support ASM: Create licensed ASM zones, offer legal markets, guarantee minimum prices, and guarantee finance safety and traceability programs so that artisanal output can enter global, ESG-compliant supply chains. International aid and private sector deals can accelerate this.
- Funds for environmental protection measures and remediation: There should be mandatory environmental bonds to avoid becoming a long-term liability, and the community should be involved in public consultation.
- Local content and jobs: Project users need to hire local staff, contract with local procurement sources, and finance technical training for communities to play a skilled role.
- Standards for regional cooperation and traceability: Most supply chains are international. Thus, we need regional adoption of regulations for traceability and conflict minerals safeguards to prevent illicit flows and increase incentives for legal trade.
No country can dictate who benefits. Mostly, global buyers, geopolitical competition (including the case of Chinese refiners versus Western firms), commodity cycles and technology shifts, defined by the new structure of battery chemistry reducing the intensity of cobalt demand, will affect demand and prices. Flexibility and non-dependence are what countries need. For example, diversifying partners, increasing processing capacity, and ensuring standards.
The result
The growing demand for tungsten, cobalt and lithium is a real opportunity for these African countries. Nevertheless, the default scenario of crude exports feeding foreign value chains and leaving communities to absorb the adverse effects has to be avoided. With sound industrial policy and strong governance, formalizing artisanal miners and investing in midstream processing, Africa’s governments can maximize the value of jobs, infrastructure and sustainable development.